6 Tips for Successful Business Accounting | CPA Baton Rouge LA

In order to succeed as an entrepreneur, you must be structured and ensure that nothing is overlooked. It is essential that you have an action plan in order to achieve your future goals. In addition, you need to know how to reach your customers effectively through marketing. It is important to stay on top of your finances to make the best decisions for your situation. Keep all invoices and receipts for this purpose. Your financial situation will be reflected in these reports.

Here are some tips for managing your business accounting.

Organize your expenses by category
Separate your receipts into different envelopes or put them in a compartmentalized binder. You may not be able to deduct all expenses, so categorize them based on deductibility. Put a special stamp or write a note by category (100% deductible/partially deductible/non-deductible).

Keeping track of your sales evolution
If you use accounting software, you will probably know the evolution of your sales. Additionally, you can pull out a cash flow statement to see how profitable the business is now. If you are not profitable, you may want to consider these options:

• Take a look at your prices. Do you set the right price for your services? Calculate your hourly rate using this magic formula if you’re unsure:
  An hourly rate is calculated by multiplying the desired annual salary by the annual taxes, expenses, and holidays you would like to work.
• Are you targeting the right niche with your marketing strategy? Are you using good marketing tactics and strategies to reach your potential customers?
• Are your expenses too high? Is there any area where you could save money?
• Take a look at your service offering: is it comprehensive enough?

Decide on a billing method
In most cases, entrepreneurs have to charge their customers. Keeping track of your invoices and making sure they are professional and personalized is therefore essential.

Reconcile your bank accounts on a regular basis
There is a tendency for entrepreneurs to neglect this part of their business. Bank reconciliation (or account reconciliation) is essential if you want to see how your finances are doing. Sometimes figures in your accounts don’t match those on your bank statements and vice versa.

Examine your financial statements on a regular basis
When you are just starting out, it is a good idea to review your financial statements on a monthly basis. In this way, you will be able to gauge your financial health more easily. You will also be able to verify whether you are following the financial forecasts in your business plan. Quarterly financial statements are sufficient once you move out of the startup phase.

Get in touch with your accountant
A good financial decision can only be made by an entrepreneur with the support of someone they can rely on. Your accountant can advise you on what steps to take next and what strategies to implement. Managing your business is your job, not doing the accounting.

You can count on our accounting firm for help. We invite you to contact us today for a consultation.